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Alienating private sector worst remedy

WE have been informed by those who “threw away the textbook” a long time ago that it is speculators on the stock market and other such national saboteurs who cause inflation and other evils.


I picked up a few lessons in Econom

ics 101
and Introduction to Financial Markets at some distant university in Matabeleland.


If one “mops up” liquidity to the tune of $70 billion and offers Stabilisation Bonds at 500% for year one, watch what happens.


Six months later you will have interest payment to the tune of $175 billion (interest). Six months after that you will again have interest payment of $175 billion and the maturity payment of the principal ($70 billion). And where one creates money there will be a destination for it. Too much money chasing too few good causes…inflation!


The Voodonomics that’s being used to run the monetary policy are ruinous. Rather than let the private sector lead the charge towards the revival of some of the parastatals and the economy as a whole, the private sector is now regarded with suspicion and it’s alarming to think that they think the Russians and Chinese will save us.


One thing Rhodesia can teach “those who threw away the textbook” is that alienating the private sector is the worst remedy to an economy. Rhodesia thrived because the private sector was allowed to grow unlike this business of regarding them with suspicion.


Some 100 years from today posterity will ask why we allowed, even begged for, Sino-colonisation after fighting a bloody war to rid ourselves of the same evil…from the West. We have but one guarantee now, at this rate it’s going to get much worse.



David King,


Harare.

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